Comments Off on Modern media auditing: from assessing value to optimizing buying
By Victoria Potter, US Business Director at ECI Media Management
The current media landscape is complex and ever-changing, thanks to constant technological advances and a dynamic economic context. It’s an exciting yet challenging time to be a marketer: with so much consumer data to leverage and so many channels to choose from, how do you ensure that your advertising investment is working hard to build your brand and drive sales?
To learn from your advertising campaigns, a media audit is crucial
Working with creative, media, tech and data specialists is of course a given: from concept to execution, working alongside experts will help you to ensure that your strategy has the best chance of reaching the right audiences, and resonating with them. But to learn from your campaigns, you need to conduct a media audit.
Go beyond the pool for an approach that optimizes against your objectives
The traditional method of media audit is to use the pool to benchmark the advertiser’s spend to understand whether their media buy has delivered good value. However, pool benchmarking only scratches the surface of how data can help advertisers understand the efficiency of their advertising investment. Our forensic approach to auditing goes beyond the pool approach: it is more strategic and focuses on achieving the client’s goals, not just whether good value was achieved. As media fragmentation becomes more prevalent, KPIs such as targeting and coverage are key drivers of greater efficiency and value. This allows us to understand the sweet spot of hitting the audience from the targeting, reach and cost perspectives, and to provide actionable insights into how they could buy better for their next campaign.
A bespoke KPI framework
As modern auditing needs to incorporate quality KPIs and spend effectiveness in order to deliver value to the advertiser, we establish a bespoke KPI framework that optimizes the client’s ROI. We’re agile, digital-native and independent: ever since our formation we have championed a modern approach to media auditing so that we can help our clients to not just navigate the increasingly complex media landscape, but to benefit from that complexity.
There’s nothing more expensive than buying the wrong strategy
Never has it been so important to optimise media buying and reach the right audiences in the most efficient way. The TV landscape is undergoing momentous change: audiences are fragmenting as the number of streaming platforms multiplies, many of them ad-free. Ratings on linear and OTT TV are deteriorating but, but the cost of advertising is still inflating (see our latest inflation report for more insight and context). This means that being present on the wrong programming carries higher stakes than in the past: there is nothing more expensive than buying the wrong strategy.
Change is the only constant
In the complex modern media landscape, change is the only constant, and keeping abreast of that change is the only way to win. Advertisers must understand how to make their ad dollars work as hard as possible in order to maximize effectiveness – and a modern auditor can help that to happen.
At ECI Media Management, our approach guarantees higher media value than the pool approach, as it is specific and tailored to our clients’ needs.
If you’d like to discover how a modern media audit could benefit your media performance, contact
Comments Off on ECI Media Management Inflation Report 2020: what’s driving TV inflation?
Understanding media inflation is crucial for advertisers
Advertising is an investment: an investment that organisations make into their future success, to grow their business and secure their future. And those organisations, just like any other investor, must have a thorough understanding of how the market – and their investments – will fluctuate, in order to understand the eventual value delivered.
ECI Media Management’s Inflation Report offers analysis and context on media inflation
That’s why we at ECI Media Management we release our annual Inflation Report in Q1 every year, with an update in Q3. Our experts analyse data drawn from our global network of offices, cross-referencing it with industry sources in order to make the most accurate forecasts possible. We provide media inflation predictions for seven media channels – TV, Digital Display, Digital Video, Newspapers, Magazines, OOH and Radio, at a global and regional level as well as for 61 countries across North America, Latin America, Europe, Africa, the Middle East, Asia and Oceania. As media inflation is intrinsically linked to global economies and events, and developing technologies, our reports provide the context that is so critical for brands making important advertising decisions.
The key finding for 2020: TV and Digital Video inflation set to peak
Our 2020 inflation report, released earlier this month, revealed the key finding that, while global media inflation in 2020 will remain largely consistent with 2019 figures, video media will experience a significant increase in inflation this year. TV will reach 7.1% and Digital Video will increase to 6.7%.
Political and sporting drama, and audience fragmentation are behind the rise in TV inflation
What’s behind this increased inflation? Given the technological and media context, it doesn’t really come as a surprise. Of course, 2020 is set to be a year of sporting and political drama, with the Olympics, the UEFA European Championships and the US presidential election, to name just a few key events taking place at the start of the new decade. Major events of this nature always inflate TV pricing but, more fundamentally, audiences are fragmenting and ad dollars are following tend to consumer eyeballs to digital video, particularly the growing amount of premium content that digital vendors are producing. As a result, TV vendors have fewer viewers, but increase their prices to maintain advertising revenues.
Is this digital advertising’s moment?
Despite rising costs, TV remains the best way to deliver mass, quality audiences. Digital inventory is of course plentiful, but it is of varying quality and is susceptible to ad blocking and data privacy laws. The decline of the cookie will exacerbate advertisers’ difficulties with digital advertising, forcing them to rethink how they reach audiences with relevant advertising. We believe that in the medium term this could herald a golden era for digital advertising, with a focus on high quality opportunities such as contextual marketing. In the meantime, TV offers advertisers a brand safe, brand appropriate way to reach quality audiences, build their brands and, with the advent of addressability technology such as Sky’s AdSmart, target specific audiences.
Actionable insights to navigate the complex media landscape and maximise effectiveness
It’s imperative that today’s advertisers take advantage of and respond to the changing media and global landscape in order to drive the highest possible value from their investments. In a context of rising media prices, we at ECI Media Management empower our clients to make the right investments by providing forensic analysis of their media activity, and actionable insights so they can successfully navigate the complex digital market and maximise TV effectiveness. The ultimate goal is to drive higher media value, and media-led impact on business performance.
You can read the ECI Media Management Inflation 2020 report here.
Contact us if you would like to discuss anything you learn in the report:
Comments Off on The future is here: Samsung at CES 2020
It’s called the Consumer Electronics Show, but really, CES is a showcase of the future. Over three days across Las Vegas, attendees are shown how tech will create a strange, beautiful new world. Each year there is normally one brand that garners a lot of attention for its innovation and vision: this year it was Samsung, that most future-facing of organisations.
Samsung launches #TheAgeofExperience
So what better way to kick of this year’s show than with a keynote from the Korean tech giant? The President and CEO of the Korean tech giant’s consumer electronics division, Hyun-Suk Kim, took to the stage in front of an audience of thousands of delegates on Monday evening to explain Samsung’s vision for the future. That vision has the consumer very firmly at its heart, and ushers in ‘the age of experience’. In a world where 74% of us value experiences over products, Samsung has set out to provide consumers with meaningful experiences and memorable moments through the seamless use of innovative, unobtrusive technology.
Help in the home
H.S. Kim and some of his colleagues took delegates on a journey to show them how Samsung innovation will create these meaningful experiences for ourselves, in the home and in cities. We were introduced to Ballie, a small, spherical robot that understands you, supports you and reacts to your needs so that it can help you around the home. It can follow you around the home (without getting in the way) and can even help you look after your pets and instruct robot vacuum cleaners to clean dirty floors!
A personal fitness assistant for all
Another way in which Samsung has harnessed AI to support personal care is its fitness assistant, which pairs the existing GEMS outfit with other devices such as AI glasses and a smart watch to help users meet their health and fitness goals. GEMS and AI glasses can also be used to help people with disabilities to move and see, reinforcing Samsung’s promise to enhance people’s lives.
The home as a living organism
The GEMS demo showcased how the blurring of the physical and online worlds is allowing homes to act as other spaces too, including fitness studios, art studios and entertainment spaces. The home is becoming a living organism, an intelligent and deeply personal space that tailors experiences to our individual needs. Smart kitchens will be nutritionists, chefs and shopping assistants, giving meal recommendations based on your workout and what is in your fridge, putting missing items on a shopping list and even recommending wine pairings. Another exciting innovation revealed was the cooking assistant ‘Chef Bot’, a large pair of arms suspended over the kitchen worktop which can help you to whip up a meal.
Building the smart cities of the future
Samsung’s innovations demonstrate how the internet of things is expanding to make our lives easier in a personalised, non-intrusive way. But it is also growing its reach beyond the home and into the cities that so many of us inhabit. A key challenge facing us in the future is the rise of megacities (cities of more than 10 million people): it is predicted that by 2050, 70% of the global population will live in cities, with 42 megacities. This poses questions around how housing provision and transport will cope: and this is another area in which Samsung is finding smart ways to converge technology, building the cities of the future. Building structures will sense when there is a fault and send an alert before it becomes a problem, while residents will be able to manage deliveries, energy and other services with a simple voice command. Meanwhile, 5G vehicles such as the Digital Cockpit will communicate with one another and the passengers’ personal infrastructure for seamless, safe and clean transportation.
Prioritising data privacy and security
Of course, smart technology which so fundamentally affects and enhances our lives will require a huge amount of data, which Samsung will need to harness in order to ensure that its products deliver on their promises. H.S. Kim underlined the company’s commitment to data security and personal privacy, emphasising that they will be a top priority as technology advances and that customers will always have control over their information.
Experiencing the future
After Samsung’s keynote many in the audience were eager to visit Samsung’s space on the show floor and it didn’t disappoint. In their huge space we were treated to futuristic demos from the Chef Bot, Ballie and Bot Air, which cleans the air in your home, and witnessed a simulated demo of Digital Cockpit, which uses 5G to link features both inside and outside the vehicle, and provide connected experiences for driver and passengers. Dominating one end of the Samsung space was The Wall, a modular ‘as-big-as-you-want’ MicroLED screen – the iteration they had on display was a huge 7.4m (292 inches), and the colour, contrast and quality are mind-blowing.
The GEMS exo-skeleton was also on display, as were a huge array of connected living devices and of course the high-quality laptops, tablets, smartphones and TVs that Samsung is so well known for.
A bold vision for the future
Samsung clearly feels huge responsibility: to provide meaningful experiences and memorable moments for consumers, to protect their data whilst making their lives better, to ensure that tech is a force for good, and to educate the next generation of innovators. It’s a big task but they are well positioned to deliver on it all, and more. The future is a strange place: Samsung’s innovations make it even stranger but also reassuring: technology will ensure that our lives run more smoothly and more healthily so that we can focus on what’s important. As H.S. Kim said in his concluding words, Samsung will dream big and defy barriers with people at the centre, for a better today and tomorrow. What could be more exciting than that?
The momentum doesn’t slow for a second at CES! On day 2 in Las Vegas we were treated to a smorgasbord of innovation – some ready-to-go, some just conceptual, but almost all are exciting and will transform how we as consumers go about our everyday lives.
Hollywood meets Silicon Valley – but will it work?
We started the day by attending one of CES’ flagship corporate keynotes. This one was from Jeffrey Katzenberg, former Disney Chairman and founder of Dreamworks, and Meg Whitman, former President and CEO of eBay and Hewlett Packard. They were unveiling Quibi, their mobile entertainment platform which they have positioned as the sweetspot where Hollywood meets Silicon Valley; they underlined the collaborative aspect of the creative process, where content creators and engineers work hand-in-hand right from the start to drive innovation. Quibi offers viewers a ‘revolutionary’ video-streaming technology that delivers portrait and landscape video at the same time, and allows creators to take advantage of other mobile capabilities such as GPRS, time, camera and interactivity. All content is in ‘quick bites’ (hence ‘Quibi’) of 10 minutes or less – so that it can be consumed in those historically hard-to-reach moments on the go. This means super-short series episodes and splitting movies into ‘chapters’.
A lot of emphasis was placed on the opportunities that this platform represents for advertisers, especially the fact that it specifically targets the hard-to-reach millennial generation at a time when they are particularly hard to reach – on the go. Their low ad-load will also no doubt appeal to ad-weary generation Y. Quibi’s first-year advertising inventory, worth $150m, has sold out and they have many world-famous brands on their client roster, including AB InBev, Procter & Gamble, T-Mobile and PepsiCo; the latter was invited on stage to talk about the innovative, collaborative creative process and the brand-safe, brand appropriate environment.
Quibi is undoubtedly an innovative new streaming platform and the idea of creating short-form video content for the on-the-go generation is a good one, but some questions remain. In the age of the streaming wars, how will this young start-up fare against established competitors such as Disney, Netflix and Warner? And will viewers really want to keep flipping their phones while they are watching a show to get the full Quibi experience? Furthermore, with content costing on average $100,000 a minute to produce and with plans to deliver a huge amount of content, is the business model sustainable? Quibi launches in April – after that, time will tell.
A dose of futuristic technology
After Quibi’s talk we made our way up the Strip to the Las Vegas Convention Center, where the world’s leading future-facing brands showcase their innovations. The Center is mind-bogglingly huge with the footprint of many exhibitors’ ‘stalls’ matching that of a mansion. We made a beeline for Samsung’s space, eager to see for ourselves the products that they revealed in their keynote speech. There’s so much to say about Samsung’s contribution to CES that we will be posting a separate blog about it tomorrow, but suffice to say that their space was seriously futuristic and shakes up what the future of the home, the city and even of you (and me, and all of us) looks like.
It’s all about screens
Screens were a big area of innovation. Our eyes were drawn by LG’s undulating display of their OLED screens – and as we entered the LG space we were shown just how slender these screens are. There was also a roll down screen on display – similar to the roll-up screen showcased a few years ago and which is now available to buy. Meanwhile, Samsung displayed its enormous MicroLED screen called ‘The Wall’. MicroLED technology allows screens to be built at any size, and The Wall is truly huge, at 292 inches or 7.4m. Its sheer scale and extreme brightness and contrast meant that it was truly a sight to behold!
Flexible screens were another big talking point. Intel showcased its conceptual 17-inch foldable screen which works as a laptop or monitor, while Lenovo unveiled the ThinkPad X1 Fold. It seems inevitable that foldable screens will become far more commonplace over the next few years.
Tomorrow: Samsung deep dive
We’ll be posting a deeper dive into Samsung’s presence at CES tomorrow, including their keynote and seeing their innovations in action on the show floor. In the meantime, if you’d like to discuss anything at CES and how it affects marketers, please contact us on
Las Vegas, early January: it must be time for CES, time for 180,000 delegates to discover, quite literally, what the future holds. Alongside the famous show floor, where delegates can enjoy futuristic product demos from brands as diverse as Samsung, Nikon and Impossible Foods, there is a dazzling array of talks and discussions on a wide range of topics, from smart cities to health and fitness.
We spent our first day on the ‘Future of TV’ tract, a series of panel discussions and talks featuring brands, agencies and TV experts discussing what the future holds for TV, and what that means for advertisers.
A mantra for the new decade: progress before perfection
The day started with a session on ‘The New Frontier of Television’, with the Editor of Forbes’ CMO Network, Jenny Rooney, interviewing Deborah Wahl, Global CMO of General Motors, about what developments in TV mean for her brand. Deborah talked about how GM has reaped huge benefits from the rapidly changing TV landscape – their effectiveness has increased by 10% over just three month – and how they are embracing the change by getting their teams comfortable with learning and failing. She noted – as have many over the week – that failure is inevitable, but that’s ok. If everything you do is working all the time, then you’re not doing enough, because there’s so much out there to play with. Deborah’s mantra epitomises this mindset: progress before perfection.
Deborah also discussed how excited she is about the future of TV and how the huge amount of data available to advertisers now is helping creativity to become scientific. It’s delivering faster, better, more measurable results so that creative can be customised in almost real-time, creating content that is better for consumers – and therefore better for brands.
When CTV effectiveness is fully measurable and provable, ad dollars will shift quickly
Next up was a panel featuring Lynn Blashford of White Castle, Gustavo Alvarado of Activision and PepsiCo’s Kate Brady, facilitated by Innovid’s Stephanie Geno. The group discussed scaling success in connected TV (CTV), and started out by discussing what is holding brands back from CTV: it receives just 3% of media investment in the US, despite accounting for 30% of media consumption. The key reasons given were measurement, high CPMs, a lack of inventory and proven models from linear TV: investment in tradition TV has always led to an increase in sales, and it’s difficult to take money away from something that is proven to work. Brands are still looking for ways to illustrate success as clearly and quickly for digital devices and CTV so they can start shifting significant ad dollars to these platforms.
Kate Brady mentioned how her ultimate goal is to harness data from CTV to optimise activity on a weekly basis – and ideally even more frequently – ‘the more data we can have, and the better we can optimise, the more it will help us’. She emphasised the importance of using data to work out what resonates with one customer versus another, so that personalisation can drive brand love as well as ROI. Meanwhile, Gustavo Alvarado discussed how direct response hasn’t been a focus on how we buy TV, but the opportunity to ‘add to cart’ direct from a CTV ad would be a really exciting development for advertisers. However – he said that whatever the future holds, it must be measurable. Measurement is key.
What do the streaming wars mean for CMOs?
With the launch or imminent launch of streaming platforms from Disney, Apple, NBC and Warner, we were particularly excited about the next session, about what the streaming wars mean for CMOs. Innovid’s Tal Chalozin interviewed Rich Greenfield from LightShed Partners about how CMOs can best navigate this new landscape. Rich noted how numbers for live TV are down by double digit percentages, and even when we do watch live TV we are not as engaged as we used to be, particularly during ad breaks. That’s true even for live sport, the saving grace of linear TV. This is partly because the ad experience on traditional TV is not nearly as engaging for viewers as it is on, say, Instagram. TV advertising has not kept up with the internet and isn’t customisable or shareable. He went on to discuss how expensive channel bundles are and how they force consumers to pay for channels they are not interested in. This, combined with a frequently heavy ad load, sends consumers straight into the embrace of the streaming platforms which are cheaper, offer content that they actually want to watch, and allow them to watch it seamlessly across devices.
An interesting point that Rob raised was the fact that wealthier consumers are now effectively able to buy themselves out of advertising – so how do we reach them? The obvious answer is live sport, but there simply isn’t enough to satisfy the demand of the many brands for whom wealthier demographics are their target audience. It’s a question that has yet to be answered, but integration may be part of the solution.
Moving from creating ads to curating experiences
Next to take to the stage was the Chief Marketing and Communications Officer at Mastercard, Raja Rajamannar, in discussion with Innovid’s Beth-Ann Eason about Mastercard’s new approach to marketing. Raja started by emphasising that Mastercard now looks at consumers as people, for whom consumption is just a small part of their lives. What happens outside of that consumption – how they live their lives, their values, their passions – informs how and what they consume. People are bored of ads and care more about experiences than things, so Mastercard’s marketing strategy focuses on ‘nothing but curating experiences’, targeted in a highly effective way. Raja’s team divided people’s lives into 10 different passion points, such as music and food, and curated multi-sensory experiences at scale, with seamless and non-intrusive integration of the Mastercard brand. These experiences engage people completely and make them want to tell and spread the story of that experience – word of mouth for the 21st century. This strategy and razor focus on experience has helped Mastercard to move from number 87 to number 12 in Kantar’s ranking of the top 100 most valuable brands, and to be named Interbrand’s fastest growing brand across all categories.
The future of linear TV in the US relies on NFL
Innovid’s ‘Future of TV’ tract was wrapped up by Luma’s inimitable Terry Kawaja, who took us on a rip-roaring ride through the stream wars and the future of TV. He pointed out that the streaming wars have created Nirvana for customers, who have more choice at less cost, and that the future for linear television in the US essentially rests in the hands of NFL. NFL contracts are up in the next few years, and the big tech companies such as Amazon are getting ready to swoop – Jeff Bezos himself has said that Amazon wants to use live sports to drive value for prime customers. The big problem for the linear TV companies? Those big tech companies have a lot more money, and global reach. In order to defend themselves, the broadcast networks are turning to scale consolidation, direct OTT distribution and CTV tech acquisition – but they need to do it quickly.
There are few losers in the future of TV
One of our favourite slides of the day was one that we shared on our LinkedIn page here. In it, Terry showed his audience the winners and losers of the streaming wars. For agencies, tech intermediaries, big tech, content creators and consumers the streaming wars are undoubtedly great news, while for media distributors it is less positive. Terry believed that for brands it could go either way, but in a subsequent panel discussion that he hosted with brand CMOs and TV experts, he revised his opinion and decreed that the age of streaming was in fact a great opportunity for brands!
An opportunity to bundle streaming service packages
Another key takeaway from Terry’s talk was his prediction that the myriad options available to consumers would in time open up an opportunity for an independent third party to re-aggregate the streaming platforms, bundling up their services in order to make them more manageable – and more affordable – for consumers. His prediction for who that third party could be? Apple – who could well want to position themselves at the top of the TV ‘waterfall’ in the same way that Amazon is for shopping and Google is for search.
More insights from #CES2020 tomorrow
Day one at CES was an incredible opportunity to hear from experts about their vision and predictions for the future of TV: if you would like to discuss anything you have read here in more depth with our experts then please ">get in touch. In tomorrow’s blog we’ll be covering the keynote from Jeffrey Katzenberg and Meg Whitman on their new mobile entertainment platform, Quibi, and bringing insights and innovation from the CES show floor.
Comments Off on Why the decline of the online tracking ecosystem could be the start of a golden age for digital advertising
Advertising without digital is like transport without engines. Yes it’s possible and yes there is something quite charming about it, but it’s old-fashioned and less efficient: once you’ve tasted modernity, you can’t go back. Digital advertising has brought us capabilities beyond the 20th century marketer’s dreams: individual targeting based on behaviour and preferences, as well as cross-device tracking, programmatic buying and real-time optimisation.
Much of that was made possible by the humble cookie, but after 25 years its very existence is under threat. Indeed, tracking online activity is a house of cards that has been slowly but steadily collapsing over the last few years thanks to ad blocking, browsers blocking cookies, the rise of walled gardens and cookie-free environments such as apps, connected TVs and the Facebook stack, and privacy regulations. But what does that mean for advertising? In truth, no one really knows. Should marketers be quaking in their boots? Will programmatic die along with the cookie? Is the cookie even dying? In all the uncertainty, we can be sure of one thing: digital advertising will change and the successful marketer will be the one who adapts.
Look beyond the cookie for reach, frequency and frequency capping
Cookies can still be used to track and control reach and frequency in Google’s Chrome browser, which still has a majority market share in many countries, although its key competitors – notably Firefox and Apple’s Safari – have smart cookie-blocking technologies activated by default. This means that all browsers except Chrome are a black hole for measuring reach and frequency based on cookie data. Furthermore, Google is moving towards an opt-in version of cookie blocking, making the future of cookie-based tracking precarious.
One solution for ensuring that reach, frequency and frequency capping are still tracked effectively is the use of audience verification services, for example Nielsen DAR and ComScore vCE. These services validate delivery, reach and frequency for real human audiences with much less reliance on cookies. However, very few advertisers outside the US invest in these products – we expect this to change as the cookie continues to decline.
A return to contextual marketing
Targeting is another area that will be dramatically affected by the change in the tracking landscape – and nowhere is this truer than in programmatic buying. Much of what we recognise as programmatic buying relies on the cookie and is therefore likely to decline. That doesn’t however mean that DSPs will become useless: marketers will still be able to efficiently handle direct, high-quality publisher deals, as well as buy lower cost, mixed quality data-free inventory across select sites on the open web.
While the ability to target individuals on the open web is likely to decrease with the collapse of the tracking house of cards, contextual targeting is set to explode. Contextual targeting is based on the content the user is looking at, rather than their behaviour profile, meaning that ads are more likely to be relevant to their current activity. It puts an emphasis on the placement of the ad, so is similar in that respect to traditional print advertising – the focus is on producing and distributing relevant content. This approach allows advertisers to deliver marketing messages to consumers when they are in a specific situation or frame of mind; as consumer behaviour becomes more fragmented and unpredictable, taking the guesswork out of advertising can only be a win.
Contextual targeting is not just an answer to the demise of the cookie: it is also an antidote to many of the issues around brand risk and safety, and is a way to be less dependent on the personal data that is so heavily regulated by GDPR and CCPA.
Is this digital advertising’s moment?
While the collapse of the digital advertising house of cards may seem catastrophic to brands who have relied on precise targeting in their advertising strategies, in reality it opens as many doors as it closes. Indeed, with consumers now spending more time in apps than in longtail websites, making programmatic audience-targeting even more challenging, many marketers will already be exploring ways to bypass programmatic altogether. The resultant high quality, content-focused advertising is pushing out and replacing click-bait strategies. Perhaps the decline in the online tracking ecosystem will herald a golden age for digital advertising because, ironically, the shift away from targeting individuals will lead to a better user experience.
Comments Off on The streaming revolution: should marketers be worried about ad-free streaming?
The New York Times recently observed that Hollywood experiences a seismic shift every three decades or so. In the 1920s it was the shift from silent films to ones with sound, while in the 1950s it was the rise of broadcast television and the 1980s saw the cable boom.
As we draw to the end of the 2010s, a new seismic shift is rapidly increasing its pace. The streaming revolution is upon us, and the big three of the entertainment industry – Disney, Warner Media and NBC Universal – have either recently launched their streaming services, or will do soon. On the whole this is great news for consumers, particularly wealthier ones, who have a huge amount of high-quality content and their fingertips, although it comes at a cost, of course. It is, however, less welcome for the traditional broadcasters and cable channels, who are seeing their viewer numbers decrease at an alarming rate. In the US there was a 5.4% decrease in cable subscribers in Q2 of this year.
TV has for at least 70 years been at the heart of the advertising strategies of advertisers big and small around the world: where does this latest shift leave them? And should they be worried?
Better content, more choice, no ads
The modern consumer has more choice and control than at any other time in history, and they are more connected than ever: 50% of the US and UK populations have a connected TV, and that figure is expected to continue growing. These consumers are increasingly choosing to consume video content from the new streaming services over the more traditional broadcast channels. Why? There are two key reasons: the quality of the content available, and the fact that the majority of them are ad-free, so they can watch their favourite shows without interruption. A huge 60% of adults in the US were subscribed to a streaming service in 2019, while in 2018 Netflix use alone surpassed cable and satellite TV for the first time. With the glut of new streaming services – mostly ad-free – launching at the end of this year and the beginning of next, those figures will only increase.
If it affects consumers, it affects advertisers
As consumers leave traditional TV in their droves, advertisers are having to work out rapidly what it all means for them. Of course, if consumers are flocking to ad-free services, that makes reaching them much more difficult. This is particularly the case for wealthier consumers – a key target audience thanks to their buying power – who are more able to pay to rid their viewing experience of ads. The high-quality ad spots that do continue to reach large numbers of consumers – think live sport and of-the-moment experiences such as the Oscars – will increase in cost dramatically. Indeed, many TV media owners will be rethinking their inventory strategy and may well have fewer, higher impact ad spots for which advertisers pay a premium. This is also more likely to be acceptable for viewers as it will likely mean shorter ad spots with higher quality advertising.
Advertisers must to an extent accept some of the responsibility for the migration to the ad-free services. Consumers are fleeing ads because they are all too often repetitive, irrelevant and uninteresting. If advertisers can transform their strategies and the quality of their advertising and targeting, consumers will be far more forgiving of an interruption of the programme they are watching.
Technology will help: many traditional TV broadcasters are embracing technology in order to allow them to shift to programmatic, highly targeted buying, for example Sky’s AdSmart addressable offering which has rolled out across multiple markets over recent months. This will help increase relevance but, as we explore in this article, it’s not necessarily the answer for brands seeking mass reach – TV’s traditional USP.
It all comes down to targeting
Amid all the talk about the streaming revolution, there are many saying that it’s not over for TV. There are undoubtedly still many people watching scheduled TV; particularly for non-US audiences, local broadcasters have expertise in creating culturally and contextually relevant content that the mainly American streaming services aren’t yet doing. There is also the paradox of choice – with endless options available to them on the streaming services, there is evidence that many feel overwhelmed and gravitate back to traditional TV when they don’t know what to watch. And of course live events such as sporting fixtures will always attract viewers – although whether they remain on traditional broadcast TV remains to be seen.
However, whether people are still watching scheduled TV or not misses the point. Effective advertising is all about targeting, and if a large proportion of your target audience is absent from a channel, targeting becomes far more complex. This is especially true as the future of the cookie looks increasingly uncertain: indeed, Google may follow the lead of other browsers and further restrict the use of third-party cookies on Chrome.
The answer for marketers is, of course, to rethink, to innovate. Where do the new opportunities lie? Are there other channels and strategies that will deliver on your objectives, or will you need to increase your TV budget to secure those high-impact, high-quality spots? Creating, implementing and learning from a great media strategy will become ever more crucial as marketers strive to understand what works, and why.